- The Appraisal Subcommittee (ASC) held its first public meeting in seven months amid staff cuts and mounting scrutiny of the US appraisal industry.
- The ASC is now running with nearly 30% fewer staff, with just 17 of 22 full-time positions filled as of late 2024.
- Leadership turnover and broader federal cost-cutting efforts have hindered operations, even as demand for accurate valuations grows with $1.5T in CRE loans maturing this year.
- The ASC is one of several appraisal bodies under pressure, as lawsuits and bias investigations challenge the credibility of training and certification organizations like the Appraisal Institute and The Appraisal Foundation.
A Silent Watchdog, Now Stripped Down
After going silent for over half a year, the US Appraisal Subcommittee finally convened in June, reports Bisnow. It returned with nearly a third of its workforce gone and its mission under increasing strain. Acting Executive Director Matt Ponzar told the board the ASC is operating with about 30% fewer staff, citing cost-saving directives from the White House.
It was the agency’s first public meeting since November 2024—despite rules requiring quarterly sessions. The pause comes at a time when appraisals are playing a more vital role in underwriting and refinancing decisions, especially as trillions in commercial real estate debt come due.
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Trimming Down While Workloads Grow
The ASC, which operates under the Federal Financial Institutions Examination Council (FFIEC), ensures consistent appraisal practices nationwide. It oversees state licensing boards and monitors the influential—but increasingly controversial—Appraisal Foundation (TAF).
With only 17 of 22 positions filled, Ponzar credited the ASC’s staff with boosting the pace of compliance reviews by 68% compared to last year. Still, former Executive Director James Park warned that reducing resources could undercut public confidence in appraisals—an essential safeguard for lenders and markets alike.
A Growing Web Of Controversy
The ASC’s reduced footprint comes amid intensifying controversy in the organizations it oversees. Two lawsuits filed this year against the Appraisal Institute (AI)—a major industry group responsible for education and certification—allege fraud and a toxic workplace culture.
Meanwhile, TAF, the nonprofit that creates the Uniform Standards of Professional Appraisal Practice (USPAP), has faced criticism for becoming overly reliant on educational sales revenue and cutting ties with federal oversight. Its role in resolving appraisal bias is also being questioned as it distances itself from the ASC.
Political Turbulence At The Top
Leadership instability is also playing a role. The ASC’s previous chair, CFPB Deputy Director Zixta Martinez, has been on administrative leave since February. The broader CFPB itself faced a temporary shutdown after being targeted by the Department of Government Efficiency (DOGE), which is aggressively trimming agency budgets and operations.
Why It Matters
Real estate appraisals remain a critical piece of the lending ecosystem, especially amid tightening credit conditions and slowing transaction volume. Weakened oversight raises risks and erodes trust in valuations as lenders rely on accurate appraisals to navigate today’s uncertain market.
What’s Next
Despite the headwinds, Ponzar said more budget cuts and efficiency initiatives are planned before the fiscal year ends in September. Whether the ASC can cut costs while maintaining the integrity of the nation’s appraisal system remains uncertain.
